AI Drafter 
TaxTMI 
TaxTMI 
2025 (7) TMI 796
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....ess, the Adjudicating authority confirmed the demand. Being aggrieved, the appellant filed their appeal before the Tribunal. Thereafter this case has a chequered history. Vide Final Order Nos. A/346-351/KOL/2008 the Tribunal remanded the matter back to adjudicating authority for verifying the claim of the appellant about their third-party clearances. Taking up the de-novo proceedings, the Adjudicating authority vide Order-in-Original No. 48/Commr./BOL/09 dated-19 March, 2009 once again confirmed the demand on the ground that the applicants have failed to produce necessary evidence of sale of goods to independent buyers, so as to determine their assessable value of their goods cleared to sister concern. The appellants once again approached the Tribunal. The Tribunal vide Order Nos. 559-564/2009 dated 15-09-2015, remanded the matter back to Adjudicating Authority. After getting a verification report from the jurisdictional Asst Commissioner stating that the appellant has not provided the copies of the Invoices raised on independent parties, the Adjudicating authority confirmed the demand along with interest and penalty vide the impugned order. Now the appellant is before the Tribunal....
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....s are valued as per Rule 8 of the Valuation Rules, there is no loss of revenue because of the duty paid will be available as credit and the entire exercise would be revenue neutral and accordingly demand raised was dropped in the said case; 2.3 Further, reliance is placed on the following judgments as well to support the contention that any duty is paid by the appellant, the same is entitled as CENVAT Credit, no further duty is payable considering the Revenue Neutral Position - (a) Nirlon Ltd. v. CCE [2015 (320) E.L.T. 22 (S.C.) = [2015] 58 taxmann.com 28 (SC) = [2015] 51 GST 177 (SC); (b) CCE & C (Appeals) v. Narayan Polyplast [2005 (179) E.L.T. 20(SC) = 2005 taxmann.com 450 (SC)]; (c) CCE v. Narmada Chematur Pharmaceuticals [2005 (179) E.L.T. 276 (SC) = 2005 taxmann.com 484 (SC)]; (d) JSL Ltd. v. Commissioner 2024 (3) TMI 488 - CESTAT Kolkata; (e) HV Transmission Ltd. v. Commissioner 2023 (12) TMI 118 - CESTAT Kolkata. Considering the aforesaid settled position of law, it is most humbly submitted that the captioned demand has been raised on account of revenue neutral position, hence, no demand can be raised in such cases. 2.4 ....
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....ansfer basis. Assessable value adopted by assessee in respect of such stock transfer was less than the assessable value at which similar goods sold to other independent wholesale buyers. Duty paid available as credit to sister unit, thus, leading to revenue neutral situation. No intention on the part of respondents to pay less duty, specifically when no evidence on record to reflect upon such intention. Confirmation of demand invoking extended period not justified. 2.5 During the course of search, the Officers found a Debit Note of Rs.10,06,290/- raised for realizing additional amount from the buyers during the period 01-04-2004 to 30-09-2004, on which Excise Duty of Rs. 1,20,755/- has been demanded. At the outset it is most humbly submitted that such Debit Note of Rs.10,06,290/- found by the officers did not contain any Reference No. or date, details of the buyer, reference to original challan, description or quantity of goods or any Central Excise Invoice reference. Further, from the perusal of Sales Ledger and related records, it has been seen that no such amount has been received from any buyer, which has been certified by Chartered Accountant as well. 2.6 It is submitted....
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.... the other units. The only dispute is with the regard to the Assessable Value adopted by the appellant. The Rule 8 of the Valuation Rules 2000, during the period of dispute reads as under: Rule 8. Where the excisable goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value shall be one hundred and ten per cent of the cost of production or manufacture of such goods 8. Since the method to be adopted for captive consumption along with third party clearances, the Valuation issue got clarified by way of Larger Bench decision in the case of Ispat Industries Ltd Vs CCE Raigad - 2007 (209) E.L.T. 185 (Tri. - LB), it would be important to go through the relevant portion of this order: "2..............Before the referral Bench, the assessees had placed reliance on the decision of the Tribunal in the case of Avon Tubes v. CCE, Ludhiana 2004 (117) ECR 616 wherein the Tribunal held that when the goods are partly sold to unrelated buyers and rest are captively consumed, the assessable value of the captively consumed goods should be determined based on the value at which the goods are....
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.... would have simply stated "where excisable goods are consumed by an assessee himself or on his behalf in the manufacture of other articles" instead of preceding the above expression with the words "where the excisable goods are not sold". This view is also supported by the judgment of the jurisdictional High Court in the case of Indian Drug Manufacturers Association v. Union of India, wherein the Court held that Rule 8 applies in a situation where goods are not sold but are cleared "exclusively" to be used in consumption or for manufacture of other articles. 9. In view of what we have observed above, we answer the reference in the following terms : (a) the provisions of Rule 8 of the Valuation Rules will not apply in a case where some part of the production is cleared to independent buyers; (b) the provisions of Rule 4 are in any case to be preferred over the provisions of Rule 8 not only for the reason that they occur first in the sequential order of the Valuation Rules but also for the reason that in a case where both the rules are applicable, the application of Rule 4 will lead to a determination of a value which will be more consistent and in a....
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.... of M/s H. V. Transmission Ltd. v. CCE, Jamshedpur - 2023 (12) TMI 118 - CESTAT Kolkata, this Bench has held as under : The Appellant was 100% fully owned subsidiary of M/s. Tata Motors Limited during the period under dispute i.e. April 2000 to March 2001. Subsequently, the appellant company was amalgamated and merged with M/s. Tata Motors Ltd.. The issue is as to whether the assessable value followed by the appellant for clearing their gear boxes to M/s. Tata Motors Ltd. (TML) was correct or not. The appellant has followed the cost + 15% for arriving at the assessable value. The Department alleged that certain elements of cost were not included in the computation of the total cost and accordingly the demand was raised. 2. The Ld. Counsel submits that the entire issue is that of revenue neutrality. The excise duty paid by the appellant was Excise Appeal No.626 of 2010 5 availed as Cenvat Credit by TML. He relies on the following case law:- a) Jai Balaji Indus. V. CCE, Bolpur [2023 (6) TMI 1102-CESTAT Kolkata] b) Hindalco Indus. Ltd. v. CCE, Bhubaneswar-II [2023 (5) TMI 720 - CESTAT Kolkata] 8. We find that the issue is squarely covered b....
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....vice Tax which was not payable by the assessee. 16. In view of the above discussion, we hold that it is the revenue neutral situation, no duty is payable by the appellant therefore whatever duty paid by the appellant Cenvat credit of the same has been availed by the sister unit, question of payment of interest does not arise. In view of the above discussion, the appeals mentioned at Sl.No.2-12 are also allowed by setting aside the impugned orders. In the result, all the appeals are allowed with consequential relief." 15. To similar ratio is yet another decision of this Tribunal in the case of M/s. H.V. Transmission Ltd. v. Commissioner of Central Excise, Jamshedpur and M/s. Tata Motors Ltd. (Formerly M/s. H.V. Transmission Ltd) (formerly M/s. TML Drivelines Ltd.) v. Commissioner of Central Excise, Jamshedpur [2023 (12) TMI 118-CESTAT KOLKATA]. 16. Under the circumstances for reasons discussed above, we are of the view that, in the present matter, no case has been made out by the department. We therefore set aside the order of the lower authority and allow the appeal filed by the appellant with consequential relief. 13. We find that to the facts of the ....
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....e Dept. that the appellants have not been filing their statutory Returns like ER 1,wherein the value adopted by them would be reflected for the clearances made. Thus, there cannot be a case of suppression on their part. Further, the appellant has always been maintaining that since they are having third party independent clearances, they are not required to adopted costing plus 10 /15 percent procedure under Rule 8 of the Valuation Rules 2000. This stand is also supported by various case laws cited supra. Finally, when the situation is revenue neutral, there would be no specific gain to the appellant by adopting any lower assessable value. On this issue, the Supreme Court in the case of Nirlon Ltd Vs CCE Mumbai - 2015 (320) ELT 22 (SC), has held as under : 9. We have ourselves indicated that the two types of goods were different in nature. The question is about the intention, namely, whether it was done with bona fide belief or there was some mala fide intentions in doing so. It is here we agree with the contention of the learned Senior Counsel for the appellant, in the circumstances which are explained by him and recorded above. It is stated at the cost of repetition that ....
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.... Ltd MS Ingot (Non Alloy) -38,760M/t. SPD 122004 246M Ingot, MS Rathi Bars 5,95.350.00 12. 11,03,052.00 Cr Alloy) -39,690MA SPD 122004 246M Document 2 283 31 Mar. 2005 Shyam Sel Ltd (Polysel Divn) 04-05 Ledger for the period 01 Apr. 2004 to 31 Mar, 2005 (All amounts in Re ) Document Number Narration Debit Balance Ingot (Non Alloy), Credit Running 16:345mt 18 RPO 023005 fngot MS Tritien 2.81 475:00 20.01:47.864.00 Cf Industries Pvt Ltd -MS ingot (Non Alpy) - 18.785ml SPD 022005 Ingol MS TribentIna 2.93 700 00 20.04.41.564.00 Gt Pvt. Ltd . MS Ingot (Non Alloy) -19:550ML SPO 012005 Ingot MS Thenni Ina 74,150:00 20.08:16.414/00 CF 3 590 022005: 414M Ingot. MS Tribient ind 3.10.050.00 20 11 35 454 00 Cf Pit Lid - MB Ingot (Non) Alloy) 21:270MIT SED 022005 ngôi MS Tringni Ind 3 14 775.00 20,14,50,239,00 C/ Pvt Ltd- MS Ingot (Non Aby) =20.955M/L SO 022008 Ingot MS Tribenund 3.39 600 00 20.17:89.839.00 Gr Pýt Lto - MS Ingot (Non Alloy) - 22.640M/T VIER SPO 072005 417M ingot, MS Tribeni Ind 4,03 500 00 20 21 90 639:00 Ct Pvl. Lid - MS Ingot (Non Al....